Bristol-Myers Squibb to spin off orthopaedics unit
06 Jul 2001
As part of its ongoing restructuring plans to help it concentrate on higher-margin prescription drugs, US pharmaceutical major, Bristol-Myers Squibb, is planning to spin off its orthopaedics unit, Zimmer, into a separate entity by the first week of August this year. It is planned that the new entity would start trading independently thereafter on the New York Stock Exchange.
Bristol-Myers has been single-mindedly concentrating on its restructuring exercise. It recently sold its Clairol range of beauty products to FMCG major, Procter & Gamble, for an estimated $4.95 billion. In a related move, it sold its hormone replacement therapy business to Northern Ireland's Galen for an estimated $95 million.
While no specific details were announced by the company on the Zimmer spin-off, analysts expect the company to have a market capitalisation of between $3-5 billion. Analysts also estimate this to yield Bristol shareholders one Zimmer share for every 10 Bristol shares they hold. The spin-off decision has come after Bristol failed to attract sufficiently high bids in its earlier attempt to sell off the division, which is understood to have attracted the attention of Switzerland's Sulzer and UK-based Smith & Nephew.